The sad reality is that many Canadians don’t fully understand how biased the debit and credit system is or that it’s set up to make the banks rich and Canadians poor. Worst still, Canadians don’t know who to turn to when things go wrong.
“Unmanageable debt can be a symptom of any number of factors, including a failed business, reduction in working hours, a drop in sales commission, divorce or separation, injury or illness, or simply poor financial decision making. With timely counselling, a solid plan, and credit rebuilding strategies, it is possible to deal with the immediate financial crisis, and to develop the habits needed to avoid repeating the same mistakes,” says Paul Murphy, Managing Partner of 4 Pillars Consulting Group in Vancouver.
“People that are having financial problems often don’t have access to regular banking products and, as a last resort, become reliant on high interest lenders,” says Paul. He believes that one of the biggest problems is that most companies offering options to resolve financial difficulties have a fiduciary duty to the creditors or are funded by them.
“In the debt help industry, no one is formally prescribed to solely represent and advocate for the debtor! It is completely one-sided and fails to fully support those that need help the most, the debtors. From the moment credit is granted, right through to insolvency, the system completely favours the creditors. Even organizations designated under The Bankruptcy Act don’t represent or advocate for the debtor. They ensure that everyone plays by the rules, yet many of their duties favour the creditor,” Paul adds.
The fees of a Licensed Insolvency Trustee are based on a percentage of monies successfully recovered for the creditors – the more recovered, the higher the fee. This is certainly a conflict of interest. If a debtor turns to a non-profit credit counsellor for help these services are not free. Moreover, they are funded by the creditors. “We believe that you either represent the debtor or the creditors, not both. 4 Pillars only focuses on ensuring the debtor’s short- and long-term goals are the priority. It’s simple. The debtor pays us and we work solely for him or her,” Paul explains.
After facing financial challenges, debtors often do not receive the education and the tools needed to have a different outcome. The role of a Licensed Insolvency Trustee is critical to help resolve debt issues and to maintain the integrity of the insolvency system, but the Trustee’s role does not extend to the financial rehabilitation of the debtor.
“By us advocating for the debtor, 4 Pillars helps remove the conflict the Trustee faces. We teach debtors about the credit system, and how to rebuild a positive credit profile. We also show them how to manage their money so they don’t face financial challenges in the future, which is why 4 Pillars is the largest, independent, full service, debt consulting and financial rehabilitation firm in Canada.”
Philosophy & Approach
4 Pillars is committed to enhancing Canadians’ financial literacy and offers a number of free educational resources through its blog, and Debt Boot Camp. Fee-based services are provided on a “clients for life” model and provide ongoing support and education. “There’s obviously a need for these services - we’ve had 58,000 course enrollments since we made the programs available online, one year ago,” Paul adds.
Does their approach work? 1,400 independent reviews on Trust Pilot seem to suggest this is the case. Here’s one example.
“…I decided to call 4 Pillars, firstly because of the strong company name and secondly because I figured I could at least explore options. 4 Pillars showed me more than options. They explained every option, each outcome, what each payment would be, and helped me to see that there are caring people in this field…My process has been amazing and the continued support blows my mind. Guidance to improve credit, goals to get some savings happening, plans down the road that I felt were never in the cards for me in reality. This process really does change your life. By diligently working through the process, I know how to better manage my money. I have a credit score on the climb. I physically feel and sleep better…”
The 4 Pillars team is passionate about helping debtors in their deepest, darkest hours. “Debtors typically have a lot of guilt and self-blame. This is further complicated because they believe they have forfeited all of their rights. Many don’t have the confidence to shop around and ask the tough questions to ensure they are getting the best solution. This makes it easy to push them around. We want people to take back their power, to give them the information they need to learn from their mistakes, to level the playing field and to restore hope. When 4 Pillars is involved, we go to work for the debtor, we ask the tough questions on their behalf, and then we present ALL the options. Any fees paid to us are usually offset by the additional savings the client is able to obtain.”
Senior Management Team
Originally from Manchester, England, Paul immigrated to Canada in 2004. “I have worked in all aspects of the finance and banking industry. I witnessed the despair caused by a financial crisis and the true lack of support available. Many of the bank’s clients felt abandoned by the financial system when they needed it most. As bankers, the only advice we could give was to apply for more debt or direct the debtor to a credit counsellor which the bank funded. I knew there had to be a better way.”
When Paul began to do his own due diligence, he was, “Astonished that no one was officially authorized to advocate for the debtor. Government websites pushed the debtors to companies that either represented the creditors or were funded by them. This conflict of interest is at best overlooked, and at worst, hidden. 4 Pillars was founded in 2002 to redress this imbalance.
There are currently three partners, including Paul. Over the past 18 years Reginald (Reg) Rocha has served as President, and is one of the founding partners of 4 Pillars. Troy Tisserand, the other co-founder, maintains and oversees the technology centric aspects of the company. Troy is a huge supporter of financial literacy in Canada and works on financial literacy projects with a number of non-profit organizations. In addition to the three partners, 4 Pillars has very passionate people operating its offices, coast to coast. All staff is dedicated to serving the best needs of the debtor and supporting their local communities.
Unfortunately, financial literacy is not taught in schools. Problems start when students enter university, and suddenly have access to credit without understanding the obligations to pay back their student loan, or credit card debt. “Proper due diligence, including assessing whether the area of study will result in a job that will provide sufficient income to justify the original loan. Student debt is significantly delaying major life events such as buying a home or starting a business and the financial implications are far greater than just repaying the student debt.”
“We see a bright future for the debt industry and believe changes are coming that will ensure the debtor has the right to their own representation and truly does get the fresh start they were promised. These changes are being driven by 4 Pillars and a new association, The Canadian Debtors Association. All 4 Pillars offices are proud members. In Canada, there is no officially recognized group, profession, or process that places the needs of the debtor first. The Canadian Debtors Association is going to help change that.”
As a last word Paul says, “The number of people filing for a second insolvency is too high and something needs to be done. Facing one financial crisis is hard; a second one is emotionally and financially devastating. The good news is that insolvency provides one of life’s most teachable moments. Helping people understand how they got into financial difficulties and then giving them the tools and support they need to ensure it doesn’t happen again, is critical. The drive and determination our clients have to change their lives and create financially stable futures for themselves and their families, is inspirational and reminds us why we are in business.”
Suzen Fromstein is the author of Suits and Ladders, Ten Proven Ways to Keep Your Job Safe - with a few jokes thrown in. Suits and Ladders was an Amazon Best Selling Book in the Career Guides Category
Paul Murphy Managing Partner
4 Pillars Consulting Group
604 595 2862